CVS will charge employees $50 a month if they refuse to take a medical exam. Getty/Scott Olson

March 20, 2013

ADVERTISEMENT

CVS Caremark, one of the nation's largest convenience store chains, has given its workers an ultimatum: Give us your health info, or pay a fee.

The company is requiring all employees who participate in a work-provided health plan to undergo an annual health exam, and then share the results with the company. Workers are being asked to submit to tests for blood sugar, blood pressure, body mass, and weight, among others.

Employees have until May 1, 2014, to schedule a checkup. Should they decline to do so, they'll be assessed a hefty $600 annual surcharge, in the form of a recurring $50 monthly fee, on top of their coverage's regular cost.

CVS defended the policy as a way to nudge employees toward healthier lifestyles, the ultimate goal being to drive down the company's health care costs.

"Our benefits program is evolving to help our colleagues take more responsibility for improving their health and managing health-associated costs," a CVS spokesman said in an email to reporters.

The company claimed such policies were standard practice for businesses. As evidence, CVS pointed to a recent National Business Group Health report that found three-fourths of employers who offered health assessments also tied some sort of incentive to those tests.

Indeed, health incentive programs are becoming increasingly popular. The programs have existed for decades, but gained newfound popularity after a 2006 change to health-care laws that clarified which incentives were legal and which were not.

The percentage of employers offering such programs rose from 49 percent in 2010 to 54 percent in 2012, according to USA Today. And with the Affordable Care Act set to give employers more authority to establish incentives or fines under such programs, their popularity is expected to grow even more.

However, critics say CVS' policy is not one of incentives, but of coercion that makes compliance practically mandatory. While other policies typically offer rewards like lower rates or deductibles for healthy behavior, CVS plans to levy fees — not on unhealthy lifestyles, but on noncompliance.

"This is an incredibly coercive and invasive thing to ask employees to do," Patient Privacy Rights founder Dr. Deborah Peel told the Boston Herald, which first reported the story. "How is it voluntary if you are a low- or medium-wage person?" she added.

Peel also said the program posed troubling privacy questions, since employees would have to share sensitive personal information with CVS. CVS has said it will never see the results of the wellness tests.

In the past, others have tried to challenge the legality of such programs, though not to much success. In 2011, a Florida man, Brad Seff, sued Broward County for slapping him with a $40 fee for refusing a health screening. Seff lost the case, with the court ruling that employers could levy such penalties.